Post-Traumatic Investment Stress

Mitch Anthony

In the movie The Big Lebowski, John Goodman plays a Vietnam vet with a serious case of post-traumatic stress syndrome (PTSS). Quickly triggered to the edge of his rage, Goodman’s character continually states, “You don’t know where I’ve been, man!” He wanted people to respect what he’d been through before they started making suggestions for him.

While I’m not suggesting that your average client or prospect is in danger of “losing it,” I am suggesting that, emotionally speaking, this is an area of inquiry you want to engage in before you decide to take on a client. I feel quite safe in saying––via mass client diagnosis––that there is no shortage of Post-traumatic Investment Syndrome (PTIS) out there, and you’ll want to keep your radar up. The best solution to PTIS is to be proactive.

PTIS proliferated with the confluence of events that heralded the beginning of this millennium: the dot-com bubble of 2000, 9/11, and the never-ending revelations of corporate corruption––specifically, in the financial services sector.

There is a good chance that almost every person you meet has had a regrettable experience with money and/or with a provider of financial services.  If you begin to talk about your products and services before conducting what I like to refer to as the land mine sweep, you are putting yourself in peril’s path.

Unwittingly, you can use certain language, a certain tone, or suggest a product or idea that has been the source for a regrettable experience in the client’s past.  While it’s not your fault for sounding like something or someone else, you are culpable for the fact that you took your prospect by the arm and went square dancing into that emotional minefield without first doing your reconnaissance.

Clients may not say anything to indicate you said something that bothered them. They may just check out with their body language and tell you they just want to “think about it.”

All you have to do is ask.

I accompanied my mother to her initial visit with a financial advisor. We already had talked to a number of advisors but this particular one was the first to explore her past experiences with the question, “Have you had any experiences with other financial services providers that you would like to tell me about?”

For a few seconds you could’ve heard a pin drop. Then my mother unraveled the story of how a so-called “friend” in the insurance business had advised her to put the majority of her inheritance into an annuity with severe restrictions and penalties and had suggested an allocation that later proved disastrous. Adding insult to injury, this “friend” no longer returned her phone calls.

The advisor who asked was glad that he did––and so was I! My mother was noticeably impressed with the inquiry and felt a sense of relief in telling the story to this advisor. It was her opportunity to let him know where she had been. There was certainly a case of PTIS to be dealt with here and this advisor handled the situation by educating her on all the nuances and fine print you need to know about annuities.

Clients or prospects may be wrong in their interpretation or assessment of the situation, but you are still better off being aware of their views in these matters lest you wander down a path that triggers a sabotaging synapse. You don’t want to say something or recommend a product that sends the client diving under the conference table.

The wisest advisors I know do a clean sweep of any potential minefields in the client’s memory before they proceed to their own recommendations. Those who fail to perform this “sweep” of principles are indeed taking their prospects and clients out for a square dance in a minefield and will at best come away limping––but more likely DOA.

My recommendation, as throughout all client discovery procedures, is to find out where your clients have been before you bother finding out where they want to go. Knowing the path that led them to this place only raises the odds that you’ll partner with them on the path that leads them away from this place. This is especially true as it pertains to the financial experiences dialogue.

Adapted from Your Client’s Story:  Know Your Clients and the Rest Will Follow by Scott West and Mitch Anthony (©Mitch Anthony and Scott West)

Mitch Anthony is the founder and president of Advisor Insights Inc. and The Financial Life Planning Institute, training companies serving advisors and the financial services industry. He is the author of several books for advisors including the StorySelling for Financial Advisors.  His newest book, From the Boiler Room to the Living Room:  What the Coming Revolution in Financial Services Means to You and Your Clients will be published by John Wiley & Sons later this year.  Anthony is a contributing editor for Research magazine and his column “Financial Life Planning” appears in Financial Advisor magazine. He has been a named a “Mover & Shaker” by Financial Planning magazine and is frequently quoted by the media as an expert on financial life planning. His radio feature, The Daily Dose, is heard every day on approximately 200 radio stations nationwide. 

Contact him at mitch@mitchanthony.com

© 2008 Mitch Anthony